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<br /> <br />December 2, 2008 <br />Division of Reclamation, Mining and Safety <br />Department of Natural Resources <br />Attn. Peter Hays <br />1313 Sherman St., Room 215 <br />Denver, CO 80203 <br />Re: Permit Succession of Operator - M 1990-057 <br />Dear Mr. Hays, <br />The Union Milling Company <br />6200 S. Vivian Street <br />Littleton, Colorado 80127 <br />+1.303.947.3499 <br /> <br />DEC ? `60 <br />aeon, <br />m <br />i°in9 and gafie?`! <br />Enclosed are a Transfer of Permit and Succession of Operator (SOO) application form, <br />Performance Warranty form, and an application fee in the amount of US$ 115.00 for the-transfer <br />of Permit M1990-057 from Capital Gold Corporation to Calais Resources Colorado Inc. (Calais). <br />Financial warranty is not included per SOO Option A instructions. <br />Permit M1990-057 encompasses the Hopemore Shaft and the Leadville Mill in Lake County, <br />Colorado. Capital Gold Corporation recently sold the Hopemore Shaft to Robert Calder and the <br />Leadville Mill to Constructive Investments, LLC who's operating entity is Union Milling <br />Company, LLC (UMC). Calais leased the Leadville Mill from UMC. On-going discussions with <br />the Division of Reclamation, Mining and Safety (CDRMS) requested one entity execute the SOO <br />transferring the Hopemore Shaft and Leadville Mill permit. Calais is that entity. <br />Following transfer of the permit, Calais in conjunction with Robert Calder, will file appropriate <br />Technical Revisions to remove and release the Hopemore Shaft from permit M1990-057 and then <br />permit the Hopemore Shaft as tourist mine in accordance with CDRMS regulations. The <br />Leadville Mill will remain under the revised permit. Calais has an exclusive lease agreement for <br />the Leadville Mill for pilot plant milling of Cross Mine ores (Permit M1977-410). <br />If you have any questions or need additional information, please contact me at 303-638-2573 or <br />melderp_unionmilling com. Thank you for your help in this matter. <br />Sincerely, <br />J. Michael Elder, PE <br />Environmental Compliance <br />Cc: Mr. Nick Michael - UMC <br />Mr. Dave Young - Calais <br />Mr. John Brownlie - Capital Gold Corp. <br />Mr. Robert Calder - Hopemore Shaft